WASHINGTON Jan 25 In President Barack Obama's
first year in office, fellow Democrats and Republicans traded
pot-shots over who was to blame for the record U.S. deficit. In
2010, an election year, these are set to become broadsides.
HOW BIG AN ISSUE WILL IT BE IN CONGRESSIONAL ELECTIONS?
Democrats and Republicans will do their best to minimize
their contact with this political hot potato, so they don't get
burned in the high-stakes November elections, which could
potentially alter the balance of power on Capitol Hill.
Expect to see the blame game intensify as both parties try
to persuade voters that the other side is responsible for the
$1.4 trillion deficit, while portraying themselves as the
fiscally prudent party.
Democrats are already pushing for the Obama administration
to ramp up its rhetoric and do a better job of pinning the
blame for the huge deficit on the Republicans.
"If we don't blame Republicans for the state of the
economy, they will blame us and voters will believe them,"
warned one Democratic blogger.
Liberal economist and Nobel laureate Paul Krugman wrote in
the New York Times last week that Obama had "allowed the public
to forget, with remarkable speed, that the economy's troubles
didn't start on his watch."
Opinion polls suggest the Republicans have had some success
in convincing voters that the blame lies with "big-spending"
Democrats -- a toxic label in an election year. A USA
Today-Gallup poll conducted on Jan. 8-10 found 56 percent of
Americans disapproved of Obama's handling of the economy.
In his State of the Union address on Wednesday, Obama is
expected to defend his efforts to stabilize the economy, which
has begun to grow again, and emphasize his commitment to
reining in the deficit by the end of his term in 2012.
That is unlikely to deter attacks from Republicans, who
recognize the soaring deficit, and the anxiety it instills
in Americans, is a powerful stick with which to beat Obama and
the Democrats in the run-up to the elections.
WHO IS TO BLAME THEN? (WHAT THE DEMOCRATS SAY)
Obama used numerous speeches in his first year as president
to complain about the "fiscal disaster" he inherited from his
Republican predecessor, George W. Bush, blaming Bush's big tax
cuts and increased spending on healthcare and two wars for the
$1.3 trillion deficit he faced on his first day in office.
Democrats point out that when Bush took over from President
Bill Clinton in 2001, America enjoyed a $236 billion budget
surplus, with a projected 10-year surplus of $5.6 trillion.
"The Bush administration's swing from surpluses to deficits
added more debt in its eight years than all the previous
administration in the history of our republic combined," David
Axelrod, a senior aide to Obama, wrote in The Washington Post.
Democrats say lax regulatory policies under Bush's watch
set the stage for the financial crisis that triggered the worst
recession in decades. Obama says he needed to dramatically
increase government borrowing, which fueled the deficit, to
invest in the economy and avert another Great Depression.
The deficit is projected to grow to $1.5 trillion, or 10.4
percent of GDP in fiscal 2010.
Obama has also taken swipes at the $700 billion bank
bailout signed into law by Bush in 2008 but continued by the
current president. Obama said the program was flawed but that
the money is being repaid under his administration's
Analysts say there are dangers for Obama in over-playing
the blame game, particularly as polls suggest many Americans
believe it is Obama's job to fix the economy, no matter who
caused the mess in the first place. Obama, has acknowledged
that, saying the buck stops with him.
WHO IS TO BLAME THEN? (WHAT THE REPUBLICANS SAY)
Bush has kept a low public profile since departing the
White House, leaving it to others, such as former top aide Karl
Rove, to rebut the Democrats' charges.
In a dueling opinion piece in the Wall Street Journal last
week, Rove rejected Axelrod's view of the Bush years and
hammered the Obama administration's "reckless fiscal record",
saying it was on "history's biggest spending spree."
"Mr. Bush's deficits ran an average of 3.2 percent of GDP,
slightly above the post-World War Two average of 2.7 percent.
Mr. Obama's plan calls for deficits that will average 4.2
percent over the next decade," Rove wrote.
Republicans accuse Obama of seeking the biggest expansion
of government in decades and oppose his $1 trillion plan to
overhaul healthcare as unaffordable, despite Obama's insistence
the program will be paid for and will not add to the deficit.
They also criticized Obama's $787 billion economic recovery
plan as wasteful spending and argue that tax cuts, not more
spending, were the answer to the country's ills.
Obama targeted Republicans' "reckless" fiscal policies in
2009. Expect to see Republicans go on the attack to convince
voters it is Obama's big spending plans that are reckless and a
threat to their future.
(Editing by Paul Simao)